Attorney: Texas school funding 'hopelessly broken'

WILL WEISSERT | Associated Press

Published 7:22 am, Monday, October 22, 2012

AUSTIN, Texas (AP) — Attorneys for hundreds of school districts told a judge Monday that Texas' system for funding public schools is "hopelessly broken" and could eventually cost the state billions of dollars in lost tax revenues.

The districts were reacting in part to lawmakers cutting $5.4 billion from public schools nearly 18 months ago.

But their attorneys also say simply restoring funding to previous levels won't be enough to fix the fundamentally flawed way Texas pays for public education. They point out that the cuts have come even as the state requires schools to prepare students for standardized tests that are getting more difficult, and amid a statewide boom in the number of low-income students that are especially costly to educate.

The attorneys addressed Judge John Dietz in opening statements in a trial involving six lawsuits filed since last October on behalf of about two-thirds of Texas school districts. The largest group of plaintiffs is led by the Fort Bend Independent School District outside Houston but includes districts from Amarillo to Abilene to Austin and most points in between, as well as Dallas, Houston, and San Antonio schools. The trial expected to last into January.

"The system of school finance, as we see it, is hopelessly broken," said attorney Rick Gray, who represents school districts in one of the lawsuits.

The plaintiffs "are a united front in our belief that the system is unconstitutional," he said, adding later, "The stakes are simply too high to ignore anymore."

Districts both in rich and poor parts of the state are on the same side of the case. Texas' funding system relies heavily on property taxes and a "Robin Hood" scheme in which districts with high property values or abundant tax revenue from oil or natural gas resources turn over part of the money they raise to poorer districts.

Many "property wealthy" districts say that while they are in better shape than their poorer counterparts, the system still starves them of funding since local voters who would otherwise support property tax increases to bolster funding for their schools refuse to do so, knowing that most of the money would be sent somewhere else.

Attorneys said Monday that wealthy districts get about $2,000 more per student per year than poor districts, even though they charge average of 8 percent less in property taxes.

The attorneys also said that unless Texas bolsters its school funding, the earning power of its residents will decline so much that it will cost the state $11 billion in lost tax revenues by 2050.

Charter schools, who want state funding for their facilities, and a small number of parents also have sued the state.

All argue that the system defies the Texas Constitution, which promises "a general diffusion of knowledge" by an "efficient system of public free schools."

"If a local school district fails to provide its students a general diffusion of knowledge, such a result, while unacceptable, does not render the entire public school system unsuitable," the office said in pretrial brief.

Whatever Dietz decides is likely to be appealed to the state Supreme Court. If the courts rule against the state, it will be up to the Legislature to remake the system — but a decision may not come in time for lawmakers to tackle the issue during the next legislative session, said David Thompson, lead attorney for the group of plaintiffs led by the Fort Bend district.

Thompson said "there is no magic bullet" for fixing school finance in Texas, but added, "I would hope, if nothing else, we don't see additional cuts."

Abbott's office stands little chance of prevailing, if history is any guide.

The Texas Supreme Court ruled in 1989 that the school finance system was unconstitutional because students in rich and poor districts alike "must be afforded a substantially equal opportunity to have access to educational funds." After subsequent overhauls by the Legislature, the high court again found the school finance systems unconstitutional in 1991, 1992 and 2005.

In 2006, the Legislature cut local school property taxes by one-third and aimed to make up for it with state funding from a business margin tax that by some calculations has created a school funding shortfall of $6 billion annually.

Then, looking to plug gaping budget holes last year, the Legislature cut $4 billion in spending for schools and $1.4 billion in grant programs, causing per-student funding to fall more than $500 last year — even while enrollment is increasing by 80,000 students annually. District superintendents say they've laid off teachers and increased class sizes to cope with the cuts.

Enrollment growth has been almost entirely fueled by students from low-income families who cost more on average to educate. Last year, more than 60 percent of Texas students qualified for free or reduced-price lunches, and 17 percent of students statewide have limited proficiency in English at best — requiring more spending on bilingual programs.

Meanwhile, the state has introduced a new, more rigorous standardized testing system designed to better prepare students for college. Budget cuts have left less money for schools to spend getting their students ready for them, or providing remedial instruction for those who don't pass.

"You can't give us the mission," Thompson said, "then not give us the tools to accomplish that mission."